Advanced Cell Technology, Inc. (ACT) is a biotechnology company focused on the development and commercialization of regenerative medicine and cell therapy technology. It is currently the only company with ongoing clinical trials in the U.S. and Europe for testing the safety and efficacy of a human embryonic stem cell (hESC)-derived product. ACT's clinical focus involves a variety of eye-related indications as well as non-ocular disorders involving autoimmunity, inflammation, and wound-healing. The overall objective of this SBIR Phase I application is to extend ACT's preclinical stem cell technology platform for the treatment of systemic lupus erythematosus (SLE) and lupus nephritis (LN) using transplanted hESC-derived mesenchymal stromal cells (MSCs). SLE is a devastating systemic autoimmune disease that presents significant disease management challenges with no currently known cure. While patients with mild to moderate SLE are to some extent clinically manageable with current protocols, there remains a subset of SLE patients that resists all forms of current interventions and suffers severe disease. A critical need therefore exists for strategies that deal with this patient population, particularly for LN where remission is slow and response to current treatments limited. Although MSCs can be isolated from several sources, issues such as the scarcity of naturally occurring MSCs in tissues, loss of immunomodulatory properties upon in vitro expansion, and a lack of reliable quality control have led to inconsistencies in their reportd in vivo effectiveness. ACT has overcome many of these obstacles through a novel and efficient method that uses hESCs as a source for MSCs to derive unlimited, replenishable amounts of early-passage MSCs of consistent quality. Importantly, ACT has demonstrated that its hESC-MSCs exert therapeutic effects in several autoimmune disease models, including prolonged survival of lupus-prone NZB/W F1 mice. Due to the genetic complexity of human SLE, it is imperative to examine potential new therapeutics in LN disease models harboring different underlying genetic susceptibilities. Studies proposed here, through two Specific Aims, will employ an additional classic mouse model, MRL/lpr, to extend previous findings using NZB/W F1 mice and rationalize further development of a hESC-MSC-based approach for SLE/LN. Aim 1 will determine minimal effective and maximum tolerated doses of ACT's hESC-MSCs for reducing LN disease severity in lupus-prone MRL/lpr mice and compare the effects to those of human umbilical cord (hUC)-derived MSCs (which are showing promise in human clinical trials for lupus). Aim 2 will define the molecular and cellular targets of hESC-MSC therapeutic activity in tissues/sera from mice injected in Aim 1 and compare these effects to those of hUC-MSCs.